Show details for Charge VAT on Delivery: Tax on Delivery Settings

Charge VAT on Delivery: Tax on Delivery Settings

Charge VAT on your delivery charges as well as your products - and choose exactly when delivery should be taxed.

Charge VAT on Delivery: Tax on Delivery Settings

Charge VAT on your delivery charges as well as your products - and choose exactly when delivery should be taxed.

Guide4 min readVideo10-step guideUpdated 15 Oct 2026

Overview

By default, VAT is calculated on the products in the basket only. The Tax on delivery setting lets you tax the delivery charge too, using the rate of a tax category you choose.

What it does

  • VAT on delivery - the delivery charge is taxed at the rate of your chosen category, and the VAT total includes it.
  • Four modes - never, always, only when the basket contains taxable items, or let your tax provider decide.
  • Prices with or without VAT - tell the platform whether your delivery rates already include VAT.

How it works

  • Tax categories - named rate bands (for example Standard and Reduced Rate) in Configuration > Tax > Tax Categories.
  • Tax provider - the primary provider in Configuration > Tax > Tax Providers holds the rate for each category.
  • Tax Settings - Configuration > Settings > Tax Settings: Tax on delivery, Delivery tax categories and Delivery price includes tax.

The four Tax on delivery options

  • Not Taxable - the default. Delivery is never taxed.
  • Taxable - delivery is always taxed at the delivery tax category's rate.
  • Taxable depending on what is being ordered - delivery is taxed only when at least one item in the basket is taxed.
  • Controlled by provider - TaxJar, AvalaraA tax compliance platform that calculates taxes on transactions and supports reporting and filing. AvaTax and Tax By Country & State & Zip decide whether delivery is taxable; with any other provider, delivery is simply taxed.

Good to know

  • With Delivery price includes tax ticked, VAT is taken out of your delivery rates instead of being added on top.
  • Check the result on the Confirm order page of a test order: the VAT line includes the delivery VAT.

Before you begin

  • Make sure a tax provider is set as primary and has a rate for the category you will use.
  • Give your products a tax category - a product without one is not taxed.

Step-by-step

  1. Check your tax categories

    Go to Configuration > Tax > Tax Categories. A tax category is a named rate band such as Standard or Reduced Rate. Products and delivery are both taxed through a category.

    Tax Categories: Standard

    Tax Categories: Standard
  2. Set the rate for the category in your tax provider

    Go to Configuration > Tax > Tax Providers and click Configure on your provider. With the Fixed tax rate provider, each category has one rate - here Standard is 20.00. With Tax By Country & State & Zip you set rates per country or region instead.

    Fixed tax rate provider: Standard = 20.00

    Fixed tax rate provider: Standard = 20.00
  3. Make sure that provider is the primary one

    Only the primary provider calculates tax. On the Tax Providers list, click Mark as primary provider on the one you configured.

    Tax Providers: Fixed tax rate provider

    Tax Providers: Fixed tax rate provider
  4. Give your products a tax category

    Open a product, go to its variant (Go to Variant) and tick the tax category - here Standard. A product without a tax category is not taxed at all, and with Taxable depending on what is being ordered it also decides whether delivery is taxed.

    Product variantAn area in the specification of each Infigo Product, generally concerned with the technical elements of the Product.: tax category Standard

    Product variant: tax category Standard
  5. Set Tax on delivery

    Go to Configuration > Settings > Tax Settings. Tax on delivery has four options: Not Taxable (the default - no VAT on delivery), Taxable (always), Taxable depending on what is being ordered (only when at least one item in the basket is taxed) and Controlled by provider (the tax provider decides - supported by TaxJarA sales tax calculation and reporting service that helps keep tax rates and rules up to date for online transactions., Avalara AvaTax and Tax By Country & State & Zip; with other providers delivery is simply taxed). Choose Taxable.

    Tax on delivery: Taxable

    Tax on delivery: Taxable
  6. Choose the delivery tax category

    Once delivery is taxable, Delivery tax categories appears. Tick the category whose rate applies to delivery - here Standard, so delivery is taxed at 20%. Delivery price includes tax controls whether your delivery rates already include VAT (VAT is taken out of them) or not (VAT is added on top).

    Delivery tax categories: Standard

    Delivery tax categories: Standard
  7. Save the settings

    Click Save, then Clear cache in the admin top bar.

    Save

    Save
  8. Place a test order up to Confirm order

    On your storefront, add a product that needs delivery and go through checkout. Pick a delivery methodOne of the forms of shipping or delivery available to the customers of a particular Storefront. with a charge - here Standard, GBP 5.00.

    Delivery method: Standard - GBP 5.00

    Delivery method: Standard - GBP 5.00
  9. Before: delivery is not taxed

    With Not Taxable, the Confirm order page shows VAT on the goods only: GBP 40.00 goods + GBP 5.00 delivery, VAT GBP 8.00, total GBP 53.00.

    Not Taxable: VAT GBP 8.00

    Not Taxable: VAT GBP 8.00
  10. After: VAT includes the delivery charge

    With Taxable, VAT now includes 20% of the delivery charge: VAT GBP 9.00, total GBP 54.00. The same VAT appears on the order and its invoice.

    Taxable: VAT GBP 9.00

    Taxable: VAT GBP 9.00

Video transcript

Overview video

0:00 VAT on delivery charges

0:03 By default, VAT is calculated on the products in the basket only. The Tax on delivery setting lets you charge VAT on the delivery charge too.

0:12 It's in Tax Settings. Delivery can be not taxable, always taxable, taxable depending on what's ordered, or controlled by your tax provider.

0:22 You choose which tax category applies to delivery. Here, the standard rate of twenty percent.

0:29 Without it, a forty pound order with five pounds delivery shows eight pounds VAT, on the goods only.

0:36 With delivery taxable, the VAT is nine pounds, because it now includes twenty percent of the delivery charge.

0:43 It's built from your tax categories, your tax provider and one tax setting. The step-by-step guide on this page shows how to set it up.

Step-by-step video

0:00 Charge VAT on delivery

0:03 In this tutorial we'll set up VAT on delivery charges, and check the result on a test order.

0:09 Go to Configuration, Tax, then Tax Categories. A category is a named rate band, such as Standard. Products and delivery are both taxed through a category.

0:20 In Tax Providers, configure your provider. With the fixed tax rate provider, each category has one rate. Here, Standard is twenty percent.

0:30 Only the primary provider calculates tax, so make sure yours is marked as primary.

0:36 Each product needs a tax category too. Open the product's variant and tick Standard. A product without a category isn't taxed.

0:45 Now go to Configuration, Settings, Tax Settings, and set Tax on delivery. Not Taxable is the default. Choose Taxable to always tax delivery, or Taxable depending on what is being ordered to tax it only when the basket contains taxed items.

1:01 Under Delivery tax categories, tick the category to use for delivery. Here, Standard. If your delivery rates already include VAT, tick Delivery price includes tax as well.

1:13 Click Save, then Clear cache in the top bar.

1:17 On your storefront, add a product that needs delivery, and go through checkout to the delivery method. Here, Standard costs five pounds.

1:25 With delivery not taxable, the Confirm order page shows eight pounds VAT, on the forty pounds of goods only.

1:33 With delivery taxable, the VAT is nine pounds: twenty percent of the goods and the delivery charge.

1:40 That's it. Delivery is now taxed on every order, at the rate you chose.

Search terms

Alternate Search Phrases
vat on deliverytax on deliveryshipping taxdelivery taxdelivery tax categoryvat on shippingtax settings
Guide | Charge VAT on Delivery: Tax on Delivery SettingsLast updated: 15 Oct 2026
Incomplete
Start the conversation! Have a question? Tutorial out of date? Let us know HERE!